February 13, 2013, 5:29 am

Jump On The Train While It’s Still Here

by: The Financial Blogger    Category: Business,Career
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Right after I came back from my Holiday vacation, I received some “unconventional news” via email; one of my co-workers was quitting the bank to buy a business. I’m using the word unconventional as it’s pretty rare that someone would leave a good pay check, job security (it’s not like they are firing salespeople in the financial services industry!), most solid pension plan (unless you are willing to bore yourself working for the Government 😉 ) and unlimited advancement potential (I have earned 5 promotions in 10 years at the bank).


Still, this young fella just decided that the financial industry was not for him and that he would rather go back to his first passion; owning a restaurant.


From Banker To Cook!?!


I must admit that I know little about the food industry. I love cooking, I love going to restaurants but I never thought of how I would run my own as an efficient business model. Margins are low, plagued by staff turnover, fresh food is crucial so potential losses are very important. In other words; I don’t think it’s an easy industry to have success.


I decided to have a good talk with this “kid” to know what he has in mind. At first, it seemed to be a crazy dream where the guy and his girlfriend didn’t think much about what they wanted to do. They were looking for a way out, they remembered the great times they had serving while they were in school and thought it would be a party every day.


I spent about an hour and a half talking about his business plan, how he thought he could make money and about his financial situation. It now appears to me that his dream is not that crazy after all.


You Don’t Make a Good Dish in a Hurry


The idea of buying a restaurant didn’t come from last night’s dream or a nostalgic night about the good times at the café where he worked with his girlfriend. He had been planning this for a while. As you don’t make a good dish in a hurry, he prepared his recipes with numerous hours of work behind it.

He made a business plan, using the previous owner’s numbers and dropped them by 20%. He ran numerous scenarios, identified where he could make immediate tweaking to improve his margins and sell things he didn’t need in his restaurant. On day 1, he won’t only get the key to his business and open the restaurant, he is going to apply his plan and start taking action right away.


He also set himself up in a way where he could get burned by a plate without losing his hand.


What’s The Worst That Can Happen?


I think the most important point of your plan when you are throwing yourself into an entrepreneurship journey is to establish the worst case scenario. I’ve often ran this scenario in the event I would get laid off. While it’s almost impossible, I think you should always have a solid plan B to make sure you know where you are heading when you are in the eye of the hurricane.


That’s exactly what he did. First, he’s young, so he has plenty of time to recover from a big loss. Second, he didn’t start by buying himself some nice things when he got his first job. He and his girlfriend saved most of their income and bought a Triplex. Today, the rental property almost pays for itself while they live on the first floor for free. He doesn’t drive a nice car, he doesn’t have expensive taste, he can live on little money.


This is exactly the right mentality to start a business with. What’s the worst that can happen in his situation? The restaurant is a flop, he’ll lose 50k to 100k and will return back to his financial career (which was off to a great start anyways). By the age of 30, he won’t even feel the pain of his loss and in the meantime, he will still keep his Triplex and family. That’s the worst case scenario. He’s not lucky, he planned for it.


This is Why It’s Important to Jump on the Train While It’s Still Here


The problem when you make money is the consumption cycle you enter.  I hate to say that, but Sam from Financial Samurai is right: saving 50% of your income is the best way to achieve financial freedom. I’ve let the “savings train” leave the gate at some point in my life because I’ve taken a bite of the forbidden fruit. Since then, my eyes have opened to a whole new world of nice things to have, to do and to eat. It’s fun but costly and takes you away from saving money and realizing other projects.


I remember when I was a few years younger with no family and living in an apartment. I was putting a lot of money aside. Much like my co-worker, I hadn’t touched the forbidden fruit yet. This was my advice to him; don’t start spending the money you make and jump on the train while it’s still here.


I almost envy him. Being able to drop a conventional career, conventional life, and conventional rules to do something different is awesome. It’s awesome because you open yourself to live other experiences. He planned everything so he could do it. He did it before becoming another bourgeois sipping wine on his terrace (hey, that’s me!). There is a part of me that envies him and the other part is screaming: “look at what you have! You’re living a good life where you enjoy time with your family!.  Yeah… that’s the other part: being an entrepreneur requires a lot of hours at work. Right now, there is no way I would trade my 4 day/week schedule for owning a business. I value the time spent with my family too much right now.


The Train Will Come Back


For those who think that the train of entrepreneurship passes only once in your life, I suggest you read how I manage my windows of opportunity to understand that there is always one opening very soon. The key is to be prepared to seize it.


The best way I know to seize an opportunity is to live a simple life and pay down your debts. These two things are quite a challenge for me right now… but I have my own way of making things happen ;-).

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Nice post Mike! I screw up few years, but now I’m also on a train into “unconventional life” . Planning and living in a manner that won’t close many doors in future is probably the best thing one can do while young.

Opportunity only comes up occasionally and you have to recognize it. You can pass it up and it may never happen again. I had my opportunity, 28 years ago and I grabbed it There is a risk in everything and you ha

The only way your coworker was able to take this risk is because of his simple lifestyle and frugal habits. The restaurant business is not one to jump into lightly without much thought and consideration. However, describing his worst case scenario is not as bad as others who have tried this path and failed miserably in much worse circumstances.

I love this story about your co-worker. It goes to show that it’s not about money, the benefits, pension or any of that. It’s about passion. When you’re passionate about something, everything else comes second.

Look on the bright side Mike, the money you spent provided enjoyment. It’s not like it went to zero. You may have to work longer, but work isn’t that bad.

We all make rational decisions based on what we want. All is good!


I know, I guess you always want what you don’t have 😉

Still, I’m glad about what I have right now! The good part is that I love my job!

There you go. If you love your job you can do it forever!

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I think you do own a business 🙂 Opportunities usually aren’t a big leap, they come from doing lots of little things until you find what works and then repeating that lots of times until it turns into something big. I have to write down ideas constantly so I don’t jump on them and start a new business every week (I only try every couple of months…).

At the same time some inspiration from other bloggers has gotten our savings rate very close to 50% recently. I like knowing that if very bad things happened tomorrow and I had to take a minimum wage job just to pay the bills, our investments would keep growing to a point where I could retire comfortably at a normal age. The important thing for me is to invest early. If you invest for 1 year and then spend for 39 years the result is very different compared to spending for 39 years and then investing for 1 year.

Having that working in the background, plus knowing that my business has the potential to go much faster than that, is a great feeling. If it goes very well I’ll be ready to retire in 5 years, just in time to start a new business 🙂 Just one of those things is enough to do well but I can never stop at one.

And after reading Mr Money Mustache for a while I have more fun and spend less which helps even more!

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